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Third Sector Research Centre
Working Paper 107
Gender balance in the governance of social
enterprise
Fergus Lyon and Anne Humbert
August 2013
This is an Author's Accepted Manuscript of an article published in Local Economy,
December 2012, vol. 27, no. 8, pp. 831-845. Information for the final version of the article
as published in Local Economy (copyright SAGE Publications), available online at:
http://lec.sagepub.com/content/27/8/831.abstract (DOI: 10.1177/0269094212455158).
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Abstract
There are high expectations placed on social enterprises as alternative forms shaping local
economies. However, little is known about how they are governed and their accountability to their local
communities. The gender balance of their governing boards and representation of women is therefore
an important issue. This paper makes a contribution to examining the claims of greater equality
proposed by social enterprises. The results draw on an analysis of a survey of 825 social enterprises
and show there is a more equal gender balance in social enterprise governance compared to the
private sector. The survey also finds that women are still under-represented on boards when
considered as a proportion of the population or the proportion of women’s employment in social
enterprises. There is also considerable sectoral concentration and a smaller proportion of women on
boards of larger organisations. Social enterprises have the potential to be alternative spaces to
encourage greater representation of women in the governance of local economies, but at present
there continues to be an imbalance.
Keywords
Social enterprise, boards, governance, gender, women.
Acknowledgements
We are grateful for the provision of the data by Social Enterprise UK and for the comments from
Simon Teasdale, Stephen Syrett and three reviewers. All views expressed are those of the authors.
This is an Author's Accepted Manuscript of an article published in Local Economy, December
2012, vol. 27, no. 8, pp. 831-845. Information for the final version of the article as published in Local
Economy (copyright SAGE Publications), available online at:
http://lec.sagepub.com/content/27/8/831.abstract (DOI: 10.1177/0269094212455158).
2
Contents
Introduction ............................................................................................................................................ 3
Social enterprise in the UK ................................................................................................................... 3
Women and organisational governance ............................................................................................. 5
Methodology .......................................................................................................................................... 6
Findings .................................................................................................................................................. 7
Proportion of women on boards ....................................................................................................... 7
Sectoral segregation ........................................................................................................................ 8
Scales of operation .......................................................................................................................... 9
Differing income sources and business models of social enterprises with male and
female dominated boards .................................................................................................... 11
Discussion ........................................................................................................................................... 13
Conclusion ........................................................................................................................................... 14
References ........................................................................................................................................... 16
Appendix 1: Proportional and nominal effect of gendered governance on sector ...................... 18
Appendix 2: Proportional and nominal effect of gendered governance on income
source ......................................................................................................................................... 18
3
Introduction
There is a growing academic and policy literature on the role of social enterprises in providing
services, employment and social capital in local economies (Amin et al., 2002; Evans and Syrett,
2007). There are also claims that social enterprises can tackle inequality through social inclusion
programmes and promoting diversity. However, little is known about governance and in particular
about women’s involvement in governance roles. This paper examines the extent of women’s
involvement and whether there are differences between social enterprises with male and female
dominated boards and draws conclusions for local economies. Social enterprises (defined as trading
organisations with social objectives) provide the potential for an alternative space from which women
can shape the provision of socially beneficial services (Social Enterprise Coalition (SEC), 2010). The
research therefore examines the extent to which social enterprises are tackling gender equality issues
in governance or whether they are reinforcing existing patterns of inequality.
The issue of gendered boards is discussed widely with regard to private sector business forms, but
it is important to examine if social enterprises are any different. This paper explores whether there is
evidence of a social enterprise oriented economy encouraging greater equality for women through
involvement in the boards of social enterprises and responds to the following research questions: what
is women’s involvement in the governance of social enterprises? What sectors are more likely to have
more women’s involvement? How does the scale of operation differ in relation to the degree of
women’s involvement? What are the differences in approach, values, income streams and finance
between male and female dominated boards?
While there is research on the gender balance of employees and volunteers in charities in UK and
non-profits in the US (Teasdale et al., 2011; Sampson and Moore, 2008), this paper fills a gap in the
leadership role women play through the governance of social enterprise. We take an exploratory
approach, drawing on the State of Social Enterprise Survey 2009 undertaken by the Social Enterprise
Coalition (now Social Enterprise UK), which surveyed 825 organisations self-defining as social
enterprises. The paper starts by reviewing the literature on the concept of social enterprise in the UK
and the role of women on boards. The methodology of the survey and analysis is set out before a
discussion of the findings identifying the differences in the gender balance of boards between social
enterprises of different scales and different sizes and within different sectors. The discussion draws
out key issues related to the proportion of women on boards and the types of social enterprises where
women are more equally represented. The implications of the differences observed between more
localised, smaller social enterprises and larger regional/national organisations are also set out.
Social enterprise in the UK
The term social enterprise is relatively new, being first mentioned in the 1970s, but rising to
prominence in the late 1990s (Ridley-Duff and Bull, 2011). The Social Enterprise Coalition Survey
uses a broad definition of ‘businesses that are trading for social and environmental purposes. Rather
than maximising private profit, their main aim is to generate profit to further their social and
environmental goals’ (SEC, 2010). This is a loose definition that can allow a wide range of
4
organisational types to be included, but excludes the public sector and the parts of the private sector
that do not have social aims as a core objective. The breadth of this definition also reflects the shifting
nature of the boundaries of social enterprise, that have shifted from focusing on democratically owned
(or socially governed) organisations to a broader organisational form that includes much of the
voluntary and community sector and parts of the private sector as well (Teasdale, 2012; Lyon and
Sepulveda, 2009).
The social enterprise sector therefore includes a range of models and different legal forms,
including Companies Limited by Guarantee, Industrial and Provident Societies, Community Interest
Companies and some forms of Companies Limited by Share. Attempts to find a common definition
and branding have led to the establishment of the Social Enterprise Mark, although only a small
proportion of organisations self-defining as social enterprises have signed up and there is on-going
debate of the parameters used.
Social enterprises can be conceptualised as hybrid forms, occupying different positions along a
continuum from the more philanthropic to the more commercial (Dees et al., 2001). The social
enterprise label is used in different contexts and this diversity of definitions is reflected in the range of
different data sources of the scale of social enterprise with different surveys reporting widely different
statistics depending on what is or is not considered a social enterprise (Lyon et al., 2010). The
definition given above can therefore be seen to be intentionally loose to allow a wide range of
organisations to self-define themselves as social enterprise and to support the growth of the social
enterprise concept.
In terms of social enterprise’s impact on local economies, qualitative studies show a wide range of
social, environmental as well as economic potential benefits. These can come from services they
provide, the extent and type of employment created, local spending and the building of social capital
(Lyon, 2009). Examples of social enterprises include development trusts, often using assets to
generate income to fund social inclusion projects; community businesses using different enterprise
models to deliver services; and work integration models that employ people from disadvantaged
backgrounds as well as providing local services such as cafes, recycling services or local food
production. The extent to which these types of organisations are providing innovative services in
alternative spaces is still a matter of on-going research.
Much of the interest in social enterprise in the UK has been driven by a policy agenda that
originated under the New Labour government (Morrin et al., 2004) where social enterprise was seen
as a policy vehicle to deliver a range of services (Spear et al., 2009). A range of policy initiatives were
introduced across the UK, relating to advisory services, loan finance and opening up public sector
commissioning to social enterprise. Similar interests were expressed by the Coalition Government in
2010 although with dramatic cuts in public expenditure, much of the support was discontinued. This
retraction of support was particularly noticeable in England with more continuation in the devolved
administrations. In England there continues to be much rhetoric of support for social enterprise
articulated as part of the Big Society agenda, although what this means for local economies remains
uncertain (Westwood, 2011).
5
However with the increased policy interest in social enterprise and the encouragement given to
these organisations to provide public services, there are also questions over their accountability
(Spear et al., 2009). It is therefore necessary to consider whether social enterprises are representative
of all parts of the communities they are seeking to serve. Understanding the role of women in
governance and on boards is therefore central to this. Paton (2003: 23) conceptualises governance as
directing organisations, shaping strategy, representing service users and safeguarding integrity.
Governing boards therefore play a key role in both the legal responsibilities (such as a duty of care)
and the wider roles related to developing strategy (Stone and Ostrower, 2007). Social enterprises tend
to include a range of different stakeholders on their boards although there is diversity between those
that are governed by users and those under the direction of individual social entrepreneurs (Defourny
and Nyssens, 2006). Ridley-Duff and Bull (2011) make a further distinction between those social
enterprises that are accountable to their external stakeholders, and social enterprises with democratic
ownership where staff and members are key players on boards.
Women and organisational governance
As social enterprises are situated in the intersection of the private and voluntary sectors, insights into
the issue of governance of social enterprise need to examine literatures on both commercial business
and the voluntary and community sector. Much of the debate focuses on the role of women on boards
focuses on larger corporates. Currently women are highly under-represented on UK private sector
boards with 12.5% of directorships held by women in FTSE100 companies (Davies, 2011). A UK
survey of small and medium enterprises found that 15.5% were majority women-led businesses where
women make up more than 50% of the partners or directors in day-to-day control of the business, or
where the sole proprietor is a woman (BIS, 2011). Other research found female directors making up
14% of posts in UK, compared to 15% in the USA (Terjesen and Singh, 2008). The actual
representation of women varies widely according to organisational characteristics, including size,
industry and linkages with other networks (for a fuller account of these variations, see Hillman et al.,,
2007). Much of the research on the sex composition of boards focuses on the reasons and
consequences of the dramatic under-representation of women in this area. Some of the reasons
attributed to women’s under-representation are that they do not fit the required criteria or
specifications (Mattis, 2000), do not have skills and experience that conforms to expectations (Burke,
2003), and that there are greater demands on women’s time, in particular from family obligations
(Mattis, 2000).
Many have attempted to build the ‘business case’ for women’s involvement in private sector boards
(Bilimoria, 2000; Burke, 1994, 2003) by emphasizing potential positive contributions. Research has
related women’s involvement in governance to financial measures such as profitability and value in the
UK (Singh et al., 2001) or the US (Carter et al.,, 2003; Erhardt et al.,2003). Further research has
examined the effect on reputation (Bernardi et al., 2006), and strategic, corporate or market
positioning (Shrader et al.,1997). Although the positive effect is usually assumed, empirical evidence
suggest the diversity of organisations needs to be considered. This suggests that it is incorrect to work
6
on the universal premise that adding women to boards will necessarily improve financial performance
(Adams and Ferreira, 2009).
As the proportion of women increases on private sector boards, a discussion has arisen on the
potential for female tokenism. Lone women on boards are described as isolated, marginal and
succeeding in spite of being women (Konrad and Kramer, 2006). This crucial aspect will be taken into
account in this paper, in particular by analysing both the number of women (nominal effect) and
proportion of boards made up of women and men (proportional effects).
With regard to women’s participation on the boards of the non-profit or voluntary sector
organisations, the limited evidence shows that women are still under-represented in many areas.
Moore and Whitt’s (2000) findings in the US indicate that men are disproportionately more present on
voluntary organisations’ boards, more likely to occupy multiple seats and to be involved in a various
number of sectors compared with their female counterparts. As they state, ‘non-profit boards in the
United States remain bastions of white, male privilege’ (Moore and Whitt, 2000: 324). Pynes (2000)
found that 44% of US non-profit board members were women and analysis of the UK’s 834,000
charity trustees, found that 48% were women in 2011 (NCVO, 2012). Cornforth (2001) reported a
trend of increasing equality in the proportion of women trustees, rising from only 35% in 1994 to 45%
in 2001. However, in larger charities 30% of trustees were women in 2001 and this had only risen to
33% in 2011 (Cornforth, 2001; NCVO, 2012).
Sectoral segregation is evident in the type of organisations where women are employed or are
volunteers (Teasdale et al., 2011). There are concentrations in activities such as schools and parents
groups, or organisations linked to women’s issues (Mailloux et al., 2002; Rotolo and Wilson 2007).
While there is limited evidence on the sectoral nature of women’s involvement, there is also limited
evidence on how these gendered sectors are influenced by the gender balance of their governance. In
part this is where women have more access, and through participation in governance of voluntary
sector organisations, women have brought topics such as children, family, and women’s health,
violence and discrimination on to the social agenda (Mailloux et al, 2002; Grant, 2003).
Methodology
This paper draws on an analysis of the Social Enterprise Coalition survey, which interviewed 825
social enterprises (SEC, 2010). The sample frame of 5,355 organisations was built from members of
social enterprise umbrella bodies operating in each region. The survey questionnaire confirmed if the
respondents defined themselves as a social enterprise having been read a definition and a description
of types of social enterprises:
Social enterprises are defined as ‘businesses with primarily social objectives whose
surpluses are principally reinvested for that purpose in the business or community, rather
than being driven by the need to maximise profit for shareholders and owners’. The social
enterprise movement is inclusive and extremely diverse, encompassing organisations
such as development trusts, community enterprises, co-operatives, housing associations,
'social firms' and leisure trusts, among others. Would you say that does describe what
your organisation does?
7
This results in a large sample of organisations self-defining as social enterprises and having links to
regional support infrastructure bodies. The sample may exclude those organisations that are not
linked into these support networks. The majority of organisations (59%) were Companies Limited by
Guarantee, usually with charitable status, with a further 12% being Industrial and Provident Societies,
17% being Community Interest Companies. A further 8% were Companies Limited by Share or sole
traders. Forms of social enterprise such as cooperatives, social firms or development trusts can take
on any of these legal forms.
The analysis presented here, is based on data regarding the sex distribution of directors, board
members or management committee members. These categories are amalgamated and it is
impossible to unpick the data further. Unfortunately, it does not offer any information about the sex of
the social entrepreneur or the senior management outside of the management boards of trustees or
directors.
Interviewees were asked about the composition of their boards using the question: “Thinking about
your directors, board members or management committee members, how many of your directors/
board members or management committee members are male? How many of your directors etc.
(board members or management committee members) are female?” Out of the 825 organisations who
responded to the survey, 30 did not know the sex composition in response to the question and 26 did
not have directors, board members or management committee members. These were thus excluded
from the analysis. This left 769 valid responses in the analysis. The number of persons on boards
ranged from 1 to 60, although very few organisations had more than 20 persons on their board, with
an average of nearly 7.5 people (with a standard deviation of 4.641).
Conceptually, the analysis of this paper, based on the findings of Konrad and Kramer (2006),
distinguishes between the nominal and proportional effect. The former takes into account the actual
number of women on boards but controls for the total number of individuals on the boards (so as to
not solely be a reflection of the size of the board) while the latter uses the percentage of women on
boards. Social enterprises with no board are themselves excluded from this analysis. This paper talks
of ‘effect’ but this should not in any way be construed as a causal link (in either direction). Instead, this
paper explores whether there are any associations between the proportional and nominal effects and
selected variables. To facilitate the analysis, social enterprises have been divided into three
categories: female-dominated social enterprises (61-100% women on board); balanced social
enterprises (40-60% women on board); and male-dominated social enterprises (0-39% women on
board).
Findings
Proportion of women on boards
The analysis shows that 41% of board members were women with an average board size of 7.5
people. However, this figure can hide considerable variation. The analysis of all boards with two board
members or more (Table 1) shows that nearly 10% of organisations have no women and a further 9%
have only one fifth of board members being women (four per cent of social enterprises have all
8
women as board members). Analysis of the number of women on boards finds that 19% have only
one woman on their board and 71% have two or more women.
Table 1: Proportion of women on boards
Proportion of women on boards N %of Social enterprises
No women (0%) 73 10%
1 to 19% 67 9%
20 to 39% 209 28%
40 to 60% 263 35%
61 to 80% 98 13%
81 to 99% 13 2%
All women (100%) 31 4%
754 100%
Note: only includes analysis where there are two people or more on a board
As mentioned in the methodology, the analysis examines the different degrees of women’s
involvement, with three categories of gendered boards. Boards that are predominantly male (more
than 60% male) make up 46% of the sampled social enterprises. The predominantly female boards
(with more than 60% women) make up 19% of the sample, while those that are balanced (between
40% and 60% female board members) make up 35% of the sample.
There did not appear to be a difference between male and female dominated social enterprise
boards in terms of age of organisation or legal form. The average age of social enterprises was similar
in each of the three categories, with a median year of creation at 2000. In terms of the origins of the
organisations, little difference was found in women’s participation on boards between those coming
from the voluntary sector, those set up as social enterprises and those coming from the private sector.
However, amongst the 10% of social enterprises that had spun out from the public sector, there was
both a statistically significant smaller proportion and a smaller number of women on boards compared
to those coming from other origins.
Sectoral segregation
While the legal form of organisations and age did not appear to impact on the gender make up of
boards, the analysis shows that there are significant differences between sectors. In particular, women
dominated boards are more likely to be found in sectors that have stereotypically been a focus for
women’s employment such as youth and childcare. In social enterprises where women dominate the
boards, 73% of the workforce is female, compared to 47% female workforce in social enterprises with
male dominated boards and women making up 57% of the workforce in social enterprises with
balanced boards. Table 2 shows the different sectoral patterns and the analysis. Statistical details and
analysis using binary logistic regression are provided in appendix 1.
9
Table 2: Primary sector of social enterprises with male and female dominated boards
N
Female
dominated % Balanced %
Male
dominated %
% female
board
members
Youth, community,
childcare, counselling 99 28% 33% 38% 47%
Health and social care 84 29% 30% 42% 47%
Education 130 24% 35% 41% 45%
Retail, wholesale 104 18% 43% 39% 44%
Arts, culture and sports 80 23% 35% 43% 44%
Housing and tenant
management 114 15% 33% 52% 40%
Regeneration, agriculture,
construction 62 16% 37% 47% 40%
Transport/ utilities etc. 43 12% 44% 44% 40%
Training, consultancy,
business support, etc. 147 17% 33% 50% 38%
Financial, insurance
services, credit unions,
etc.
43 12% 40% 49% 37%
Services, work-space hire,
media, cleaning 95 13% 32% 56% 36%
Environmental and
recycling services 59 12% 27% 61% 34%
Total 1060 19% 35% 46% 41%
Note: 754 social enterprises responded to this question and were allowed to select more than one
sector.
It is interesting to note that only two areas see both a proportional and nominal effect: the area of
youth/community/childcare/counselling and that of health and social care are both positively
associated with the proportion and number of women on boards. There are also higher proportions of
women on boards in ‘arts, culture and sports’ social enterprises. In contrast, the areas of
‘environmental and recycling services’ have a smaller proportion of women involved in boards. Finally,
the area of education sees a strong positive nominal effect showing that a large number of women are
involved in boards in these sectors but as the size of these boards can be larger, they may not be
dominating the boards as a proportion.
Scales of operation
The social enterprises in the survey were operating at a range of scales ranging from the local
(defined as smaller than one local authority) to national or international. The geographic area covered
by social enterprises appeared to be related to both the proportion and number of women on boards of
social enterprises (See table 3).
10
Table 3: Proportion of women’s invovlement at different scales of operation
N
Percentage of all SE operating at this
scale Average percentage of
women on boards
Local – less than a local authority 83 11% 46%
A local authority 183 24% 45%
Two or more local authorities 65 9% 39%
A county 90 12% 38%
Two or more counties 30 4% 36%
A region 136 18% 39%
Two or more regions 34 4% 46%
One country (England, Scotland, Wales, N. Ireland)
56 7% 36%
Multi-country or UK wide 61 8% 29%
International 30 4% 37%
Although a pattern is not straightforward, it appears that there is a (statistically significant) greater
concentration of male dominated social enterprises at the wider geographic scale as opposed to social
enterprises with female dominated boards at a more local level (Tables 4).
Table 4: Percentage of male and female dominated boards operating at different scales
N
% of SEs with female
dominated boards
% of SEs with
balanced boards
% of SEs with male
dominated boards
Local – less than a local authority 83 33% 29% 39%
A local authority 183 21% 42% 37%
Two or more local authorities 65 22% 26% 52%
A county 90 16% 29% 56%
Two or more counties 30 13% 40% 47%
A region 136 17% 39% 44%
Two or more regions 34 21% 41% 38%
One country (England, Scotland, Wales, N. Ireland)
56 18% 30% 52%
Multi-country or UK wide 61 5% 30% 66%
International 30 20% 20% 60%
11
The scales of operation refer to the delivery of specific services. These activities can be differentiated
from other forms of impact that might occur indirectly such as sharing learning and replicating
successful approaches, or lobbying. One in five women dominated boards was found to be lobbying
their local authority directly, a similar proportion to the social enterprises with balanced and male
dominated boards. However, social enterprises with female dominated boards were significantly less
likely to be involved in lobbying local and national government through membership organisations.
In terms of the financial scale, the analysis shows that women dominated boards are found in those
organisations with smaller turnovers than male dominated boards, although both female and male
dominated boards have lower turnover than the balanced boards. It is also important to note the large
range of scales within each category and also the presence of outliers, increasing the mean turnover
for all categories. For this reason we also present the trimmed mean (taking out the largest and
smallest 5% of organisations and median turnover of social enterprises. Social enterprises with female
dominated boards had a median turnover of £150,000 compared to £200,000 for all social enterprises.
The highest median turnover was found amongst balanced boards.
Table 5: Turnover for social enterprises
Female dominated
boards Balanced
boards
Male dominated
boards All social enterprises
Mean £698,822 £1,376,311 £4,273,871 £2,645,595
5% trimmed mean £377,965 £778,358 £752,007 £685,857
Median £150,000 £225,000 £200,000 £200,000
N=583
Differing income sources and business models of social enterprises with male and
female dominated boards
The analysis also shows differences in the practices, activities and values of social enterprises that
have women or male dominated boards. For social enterprises, decisions need to be made regarding
the balance of different income sources, and in particular the use of grant funding. Table 6 shows how
women dominated boards have a higher proportion of income from trading with the general public but
have a significantly smaller proportion of their income from trading with other businesses whether
these are social enterprises or private sector enterprises. Grant income from the government, defined
as funding that is provided without competitive bidding or contracts, comprised 19% of the income for
all social enterprises, although social enterprises with women dominated boards were more reliant on
these forms with 24% of their income from this source.
12
Table 6: Average percentage of income from different income sources
Female
dominated
boards
Balanced
boards
Male
dominated
boards
All social
enterprises
N=147 N=263 N=359 N=769
Trading goods or services with the
general public 32% 28% 25% 27%
Grants from the public sector 24% 18% 18% 19%
Public sector commissioners
(contracts to provide public services) 18% 20% 18% 18%
Trading goods or services with the
private sector 6% 9% 15% 12%
Donations from the public and
charitable foundations 8% 6% 8% 7%
Trading with other social enterprises 2% 5% 5% 4%
Interest from investments 1% 2% 1% 2%
Other 10% 13% 11% 12%
Differences are also observable in the extent to which social enterprises with male or female
dominated boards are making a profit or surplus. Female dominated boards have a much smaller
profit, which is partly due to the smaller turnover. Table 7 also shows that there are considerable
differences with large outliers making a considerable difference between the mean, and median. The
5% trimmed mean is used to make allowances for these outliers. As a percentage of turnover, social
enterprises with male dominated boards reported a median average surplus or profit of 5%, compared
to 4% for women dominated or 3.5% for balanced boards. The reported use of the profit or surplus
was not found to differ according to composition of the board.
Table 7: Profit or surplus for SEs with 2 or more board members
Female
dominated Balanced
boards Male
dominated Total
Mean profit £28,257 £68,766 £256,945 £148,872
5% trimmed mean £14,684 £25,240 £28,962 £23,757
Median profit £6,000 £8,000 £10,000 £9,000
13
Discussion
The analysis in this paper shows that women are better represented within social enterprise
governance compared to mainstream private for profit businesses. However, while 41% of board
members of social enterprises are women, this is not representative of the population and is certainly
far from representative of the workforce within social enterprises with an average of 57% of employees
of social enterprises reported to be women. However, the proportion of women board members is
considerably more equal than the private sector and similar to the gender patterns of boards in the
charitable sector.
The analysis shows the concentration of women board members in particular sectors
demonstrating how the social economy is highly gendered. Female dominated boards (with more than
60% women) are found in 19% of social enterprises but this rose to 29% in those sectors that have
traditionally had a highly feminised workforce (such as youth/childcare/counselling, and health and
social care). Social enterprises in these sectors had close to half of their board member positions
taken by women. In contrast only one third of board members in environmental and recycling services
social enterprises are women.
In terms of the scale of social enterprise activity, and the impacts of individual social enterprises on
local and regional economies, the analysis found that in the 35% of organisations only operating at a
local authority scale or smaller, women were making up 45% of the board members, compared to
representing only 29% of board members for organisations with a UK wide remit. This suggests that
women board members are more likely to be found in organisations with a local focus, particularly
when these organisations are operating in sectors that may have smaller turnovers, more localised
delivery and fewer multiple sites. Similarly, female dominated boards are more likely to be found in
organisations with lower turnovers, with the mean turnover for women dominated boards being 25%
lower than the total average. Interestingly, the organisations with balanced boards were found to have
the highest turnover. Further research is needed to understand why there are fewer women in larger
organisations.
This research also found differences in strategy and values between social enterprises with male
dominated boards and those with female dominated boards. A key strategic approach found to a
greater or lesser extent in all social enterprises is the use of trading income to meet their social
objectives. As organisations are relying on trading for a majority of their income, they have to find
ways to ensure their sustainability while also considering their social objectives. In this case trading is
defined in contrast to grants or philanthropic donations. The analysis found that social enterprises with
female dominated boards had a greater proportion of their income from non-trading grants (24%)
compared to either male dominated or balanced boards (both having 18%). Similarly, social
enterprises with male dominated boards (and balanced boards to a lesser extent) had a larger
proportion of their income from trading with the general public or private sector bodies. This implies
that social enterprises with women dominated boards are more dependent on grants or are
concentrated in sectors that might have greater access to grants. Other forms of philanthropic support,
14
such as the use of volunteers does not appear to differ according to the proportion of women on
boards.
The hybrid nature of social enterprises between the private and voluntary sector, gives rise to
debates within organisations concerning the creation of surplus or profit. While the voluntary sector is
sometimes referred to as the ‘not-for-profit’ sector and avoids the language of the private sector, social
enterprises are more likely to develop business models that seek to generate a profit or surplus. The
organisations in this sample had an average of 4.5% of their turnover as a surplus. The analysis
showed that female dominated boards had an average surplus of 4% compared to 5% for male
dominated boards. Social enterprises have to make a strategic decision concerning how this surplus
can be used to reach their social aims. The use of retained surplus to supplement reserves is
necessary for the sustainability of organisations, particularly those operating in less secure financial
environments or if reliant on a few sources of income. However, it should be noted that defining profit
in social enterprises can be difficult as a surplus generated within a year can be reinvested in more
services within the same financial year and therefore not appear on any balance sheet. Surpluses are
also required for social enterprises wanting to access loan finance. The most common source of loan
finance is banks, although female dominated boards were much less likely to seek finance from this
source.
Conclusion
Social enterprises appear to provide a more egalitarian environment for women’s involvement in
governance compared to the private sector. They can therefore be considered an important potential
arena within local economies providing an alternative space for governance that challenges inequality.
However, while there may be greater equality at the board level compared to the private sector,
women are still under-represented and the proportion of women on boards tends to be lower among
larger organisations operating at a national rather than local level. Furthermore, governance is still not
fully representative of the communities they serve and the gender balance of boards does not reflect
the proportion of women in the workforce.
Organisations with a majority of women on the boards are found to be concentrated in particular
sectors, in smaller organisations and with a more localised focus. This demonstrates the importance of
understanding the gendering of social enterprise activity as well as sectoral differentiation. There is
also a need to examine why women are less represented in larger or more commercially oriented
organisations. While this research has identified patterns where women’s involvement in governance
has been concentrated, there is also a need for future research to explore the effect of women’s board
involvement on social enterprise activity. There is also a need to examine the gender differences in
motivations for participation on boards, and the positions of influence that women take when they are
on boards.
This paper provides a starting point for debates on the role on women in social enterprises. The
analysis has shown that there are strong relationships between women’s involvement and sector or
organisational size. There are limitations in the study deriving from the sampling of organisations, a
factor found in all research on non-profit organisations and social enterprises without a known (or
15
defined) population. However, this study can draw conclusions from this large survey of self-defining
social enterprises. While focussing on the social enterprise organisations as a whole and their board
members, the data set did not allow for the analysis of the role of gender in shaping the executive and
senior management of organisations. While important insights are provided into the extent of women’s
involvement on boards, future research is needed on the extent of participation in boards, positions
held on board, the power dynamics within boards and whose voices are heard. In particular there is a
need to examine the gender of chairs and treasurers (Pynes, 2000). Future research should also
consider the background of board members and the extent to which they represent the beneficiaries
and involve employees. Further research should explore the dynamic nature of these organisations
and the changing gender mix on boards as organisations become more established. This raises
questions over how board members are recruited, the nature of the networks drawn on to identify
people, and the extent to which these networks are gendered (Moore and Witt, 2000).
This paper has implications for research on the governance of social enterprises as well as
governance of voluntary sector organisations and private sector small businesses. By operating at the
interstices of the voluntary, private and public sectors and demonstrating a degree of hybridity, social
enterprises can create an alternative space where women can shape local economic processes. The
policies related to social enterprises and local economies have much to draw from this work. There is
a need to consider the gendered nature of the types of organisations involved in delivering services
and how they are accountable to both users and funders. In England the Big Society agenda of the
Coalition Government looks to social enterprises to deliver more services, at times replacing those
previously delivered by the state. The role of boards is crucial in the accountability of such service
provision and while social enterprises are more representative than the private sector, there is room
for even greater equality in representation.
16
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18
Appendix 1: Proportional and nominal effect of gendered governance on sector
Sector Proportional Effect Nominal Effect
p-value Odds ratio p-value Odds ratio
Arts, culture and sports 0.050 1.007
Education 0.018 1.142
Housing and tenant management
Environmental and recycling services 0.017 0.986 0.011 0.800
Regeneration, agriculture, construction
Training, consultancy, business support, etc. 0.015 0.869
Retail, wholesale
Financial, insurance services, credit unions, etc.
Services (workspace hire, ICT, media, cleaning) 0.034 0.990
Youth, community, childcare, counselling, etc. 0.008 1.011 0.003 1.191
Health and social care 0.020 1.011 0.045 1.139
Transport and utilities
Note: Odd ratios above (below) 1 indicate a positive (negative) association with the percentage or
number of women on boards.
Appendix 2: Proportional and nominal effect of gendered governance on income source
Income Source Male
dominated Balanced Female
dominated Total Proportional
effect Nominal
effect
Trading goods or services with the private sector
15 9 6 12 β = -0.181 p < 0.001
β = -1.298 p = 0.012
Trading goods or services with the general public
25 28 32 27 β = 0.147 p = 0.007
Public sector commissions (contracts to provide public services)
18 20 18 18
Grants from the public sector
18 18 24 19 β = 0.097 p = 0.026
Donations from the public and charitable foundations
8 6 8 7
Trading with other social enterprises
5 5 2 4 β = -0.059
p = 0.01 β = -0.758 p = 0.023
Interest from investments
1 2 1 2
Other 11 13 10 12
About the Centre
The third sector provides support and services to millions of people. Whether providing front-line
services, making policy or campaigning for change, good quality research is vital for
organisations to achieve the best possible impact. The Third Sector Research Centre exists to
develop the evidence base on, for and with the third sector in the UK. Working closely with
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Social Enterprise
What role can social enterprise play within the third sector? This work stream cuts across all
other research programmes, aiming to identify the particular characteristics and contribution of
social enterprise. Our research includes theoretical and policy analysis which problematises the
concept of social enterprise, examining the extent to which it can be identified as a distinct sub-
sector. Quantitative analysis will map and measure the social enterprise sub-sector, and our
qualitative case studies will contain a distinct sub-sample of social enterprises.
Contact the author
Fergus Lyon
020 8411 6856
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This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivs 3.0 Unported License. © TSRC 2013
The support of the Economic and Social Research Council (ESRC), the Office for Civil
Society (OCS) and the Barrow Cadbury UK Trust is gratefully acknowledged. The work
was part of the programme of the joint ESRC, OCS Barrow Cadbury Third Sector
Research Centre.
